If a commercial bank engages in OBS activities,there are no additional capital requirements imposed by regulators.

Question

Quizplus · Accepted Answer

When a commercial bank engages in OBS (off-balance sheet) activities like derivatives, securitization, or guarantees, additional capital requirements are often imposed by regulators to mitigate the associated risks. These requirements are designed to ensure that banks have enough resources to cover any potential losses incurred from these activities. Failure to meet these capital requirements can result in penalties or regulatory sanctions.

If a Commercial Bank Engages in OBS Activities,there Are No